Demand for data centers is booming in 2026. The Motley Fool’s research shows artificial intelligence (AI) spending by big tech is expected to increase roughly 50% this year to $600 billion.
IREN (NASDAQ: IREN) is one of the best pure-play data center stocks positioned to benefit from this spending boom. Its ownership of fundamental assets, such as land and access to electricity, and its ability to meet construction timelines, have been recognized by investors. Despite the stock rising by over 700% in the past year, its run might be just beginning.
Image source: Getty Images.
This under-the-radar AI infrastructure stock is well-positioned for growth.
Demand for data centers is booming in 2026. The Motley Fool’s research shows artificial intelligence (AI) spending by big tech is expected to increase roughly 50% this year to $600 billion.
IREN (IREN 4.74%) is one of the best pure-play data center stocks positioned to benefit from this spending boom. Its ownership of fundamental assets, such as land and access to electricity, and its ability to meet construction timelines, have been recognized by investors. Despite the stock rising by over 700% in the past year, its run might be just beginning.
Image source: Getty Images.
Management has set a target of reaching $3.4 billion in annualized revenue by the end of 2026. However, this accounts for only 10% of its secured power capacity for its data centers. This suggests the potential to scale to around $30 billion or more over time, making the stock’s market cap of about $17 billion look cheap.
The company has already secured a $9.7 billion, five-year agreement with Microsoft. The most important part of this deal isn’t the value, but that it strengthens IREN’s credibility, helping accelerate discussions with other hyperscalers to stack more revenue.
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(-4.74%) $-2.40
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While the sustainability of data center spending might be a concern for some investors, Co-CEO Dan Roberts offered an important insight into demand strength during the company’s February earnings call. “We have multiple advanced negotiations underway for larger-scale deployments, and are also seeing hyperscalers and AI enterprises increasingly focus on air-cooled GPUs, given the faster deployment timelines.”
Roberts’ comment shows that another deal is likely imminent. But the growth story gets better. IREN’s career page currently lists key roles in Australia for “High Voltage Maintenance Engineer” and “HPC Operations Engineer.” This shows the company is preparing to expand beyond its current operations in Texas, Oklahoma, and British Columbia.
IREN’s access to finite assets, such as land and power, puts it in a strong position to deliver long-term returns to investors. These assets, along with the potential for expansion, make the stock one of the best ways to profit from the AI data center market.
